AC ENERGY Corp. was the 12th most actively traded stock last week after completing its subscription agreements with five companies worth more than P3 billion.
A total of P791.52-million worth of 97.90 million shares exchange hands at the local bourse from March 21 to 23, data from the Philippine Stock Exchange showed.
AC Energy shares closed at P8.30 apiece on Friday, up 1.2% from the Ayala-led company’s closing price of P8.20 each on March 18. Year to date, its share price has decreased by 21%.
The recent rise was due to the completion of its subscription agreement with five entities collectively known as the UPC Philippines group to nearly 390 million shares, increasing its stake in the latter’s more than 2,300 megawatts (MW) of renewable energy projects under development.
“The subscription price at the time of the signing last October was subject to market conditions. But since the transaction was finalized in March, share price has fallen to P8.2 per share, which was used as the basis for the share price. This likely reduced any overhang on the share price, which caused the stock to surge,” COL Financial Group, Inc. Research Analyst Adrian Alexander N. Yu said in an e-mail.
In a disclosure on Wednesday, AC Energy finalized five subscriptions from UPC Philippines Partners Ltd. for 19,059,423 shares; Wind City, Inc. for 142,668,634 shares; Estanyol Holdings Ltd. for 153,493,200 shares; Tenggay Holdings Ltd. for 70,525,763 shares; and Alan Kerr, or collectively known as the UPC Philippines group for 4,248,813 shares at P8.2889 apiece.
“Buying out its partner in an Australia-based joint venture will add 2,300 megawatts of renewable energy to its pipeline of new projects, which are all in line with the company’s goal of becoming the biggest listed energy platform in the Southeast Asia region by putting up 5,000 MW of renewable capacity by 2025,” Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said in an e-mail.
The takeover will give AC Energy access to UPC Philippines’ projects consisting of more than 2,300 MW in capacity currently in the works.
On March 14, it said that its subsidiary, AC Renewables International Pte. Ltd., had signed a share purchase agreement to buy the 52% interest held by its partner in a joint venture holding firm for energy and power projects and investments in Australia.
The agreement was forged on March 11 to acquire the interest of UPC Renewables Asia-Pacific Holdings Pte. Ltd. and Anton Rohner in UPC-AC Renewables Australia.
The transaction will cost AC Energy $243.3 million, initial reports showed.
The first tranche of the buyout will be done by end-March this year, while the second tranche will be completed by next year’s first quarter.
AC Energy’s attributable net income rose by 21.6% year on year to P4.27 billion in the nine months to September last year.
“Factoring in the increase in AC Energy’s share in the revenues, its net income is forecast to reach around P8.4 billion in 2022, and quite possibly around P11.5 billion in 2023,” Mr. Arce said.
He said the stock is likely to continue its increase this week, but “may encounter some resistance at P8.35. Should it manage to break through that, the next nearest resistance could be at P8.50.”
“In the longer run, AC Energy could next reach between P9.00 and P9.15. On the other hand, nearest support could be between P7.90 and P7.80. Then further down the line, maybe around P7.60. Long term, probably between P7.25 and P7.20,” Mr. Arce said.
Mr. Yu expects AC Energy’s operating profits to increase by 36% in 2022, driven by the gradual start of its greenfield operations.
“Barring any significant negative news, we may see AC Energy continue to trend higher [this] week with support at P7.8 per share and resistance at P9 per share.” — Lourdes O. Pilar
